are my fees too much?

[mayhem69]

Hi, my wife and i have roth ira's for the past 10 yrs. We have had the same investor during that time. He recently started his own quarterly fees. He said that way he can monitor our accts. closely. Between us both we have about $65,000 in a few mutual funds. A few with oppenheimer, which he said they take too much from me??
When i get my usual statement it comes from Cambridge Research Co. Don't know if i am paying fees for that also.??
Anyway our fees are .003 averaging around $200 per quarter for the wife and I.
I really don't know what to think of these new fees by my investor. I am only 40 yrs. old and $800 x 25 yrs. = $20K, that is alot of $$.
Plus my acct. hasn't done much of anything for the past several months. Seems like i am losing money here. Don't know much about this stuff.
Can a professional in the business please educate me, am i being juiced here?

[disneysteve]

$800 in fees on $65,000 in assets is 1.23%. And I'm guessing that is a management fee above and beyond the expense ratios of the funds themselves. So you are likely paying fees of well above 2%/year so probably more than $1,600/year total. I'd say yes, you are getting hosed. I'd suggest rolling over this account away from a fee-based salesperson and moving to a no-load mutual fund company like Vanguard, T. Rowe Price or Fidelity. There you will have zero management fees and expense ratios of less than 0.5% which would only be about $325/year or less depending on the funds you select.

[mayhem69]

$800 in fees on $65,000 in assets is 1.23%. And I'm guessing that is a management fee above and beyond the expense ratios of the funds themselves. So you are likely paying fees of well above 2%/year so probably more than $1,600/year total. I'd say yes, you are getting hosed. I'd suggest rolling over this account away from a fee-based salesperson and moving to a no-load mutual fund company like Vanguard, T. Rowe Price or Fidelity. There you will have zero management fees and expense ratios of less than 0.5% which would only be about $325/year or less depending on the funds you select.

Thanks for helping Steve, yes, i guess these new fees my investor started is like a management fee. What about the Cambridge Research Co. my statements are from, i wonder if i am paying fees to them.
My investor did get my out of the Oppenheimer Capital appreciation fund and put that $$ into the Vanguard Wellington Fund. So i guess this is a step in the right direction, right?
If i decide to roll my acct. myself, what do i do. I have funds in Invesco, Fidelity, Oppenheimer.

[MonkeyMama]

Completely agreed with Steve. I wouldn't be surprised if your loads and expense ratios are more than the fees you pay your advisor.

My spouse's family has a ridiculously high priced investment advisor - had my dh in all sorts of loaded funds with high expense ratios, when we first married. He was never getting ahead after all the fees (also, my poor kids have some god awful 529 with this guy - Grandma's money - more insane fees). He was really skeptical to let me dump the guy and move his money to Vanguard, but with time I have been able to prove even if I have no idea what I am doing, I can get much better results with the small fees at places like Vanguard and T Rowe. (& I really don't know much - just try to keep a well diversified portfolio - while keeping the fees down. Most of our money is just in target funds at this point - one fund with a balanced portfolio that adjusts with time to become less aggressive).

[MonkeyMama]

mayhem - often, investment advisors provide statements from a third party. In this case, is Cambridge. I believe the cost of that would just be built into the advisor fee. IF they are not deducting a fee, directly from your assets.

I think this is a good point. The advisor and Cambridge may be 2 "middle men" so to speak, that you can cut out with an institution like Vanguard.

[disneysteve]

My investor did get my out of the Oppenheimer Capital appreciation fund and put that $$ into the Vanguard Wellington Fund. So i guess this is a step in the right direction, right?

First, this person is not an "investor." He is a salesperson.

Second, investing in a Vanguard fund through a salesperson makes no sense. What you have done is taken a no-load, low-cost mutual fund and essentially turned it into a high-cost, load fund. He is charging you a fee to buy something that you can buy on your own for free.

Cambridge is probably the investment firm that this salesperson operates under.

[jIM_Ohio]

First, this person is not an "investor." He is a salesperson.

Second, investing in a Vanguard fund through a salesperson makes no sense. What you have done is taken a no-load, low-cost mutual fund and essentially turned it into a high-cost, load fund. He is charging you a fee to buy something that you can buy on your own for free.

Cambridge is probably the investment firm that this salesperson operates under.

Steve-if someone does not take the time to learn how to invest, depending on broker, that broker can put them in funds from any house (or mix them up).

Advisors usually do not collect loads+12b1 fees+ asset based management fees. They usually get paid by one of those 3 ways, or by fee only (hourly) approach. If fee only, them the individual needs to take ownership and invest themselves.

If an advisor is used, they should be compensated in some way.

[disneysteve]

Advisors usually do not collect loads+12b1 fees+ asset based management fees. They usually get paid by one of those 3 ways, or by fee only (hourly) approach. If fee only, them the individual needs to take ownership and invest themselves.

If an advisor is used, they should be compensated in some way.

Vanguard Wellington has an ER of 0.34%. If this advisor charges 1% of assets under management, would that be 1% plus the 0.34% or just the straight 1%?

[MonkeyMama]

To clarify what Jim said - that may be true - but with Merrill the advisor had us in load funds with high expense ratios and then Merrill charged large fees. Though the advisor himself did not get that fee, we were still paying additional fees to the institution. Even the smaller invesment advisors I know do use some sort of third party - though they may pay them from their own fees - rather than charging separate fees.

I do not see how you could not pay expense ratios (in addition to any management fees). The expense ratios go to the mutual fund companies. Every body gets their own cut, of course.

[PMMM]

Thanks for helping Steve, yes, i guess these new fees my investor started is like a management fee. What about the Cambridge Research Co. my statements are from, i wonder if i am paying fees to them.
My investor did get my out of the Oppenheimer Capital appreciation fund and put that $$ into the Vanguard Wellington Fund. So i guess this is a step in the right direction, right?
If i decide to roll my acct. myself, what do i do. I have funds in Invesco, Fidelity, Oppenheimer.

I agree with the others. You can educate yourself from many online sources. You can then roll your money into low cost MF or ETF's (I would shoot for 0.50% or less expense ratio and typically less turnover is better and stay away from any load funds. You want no-load funds) In today's world most investors are better off learning and doing it for themselves.

[jefffou]

I think it is interesting to see how many brokers and insurance salesmen have completely destroyed the credibility of the quality advisors out there.

There aren't many professional areas where forum posters would recommend an individual to "do-it-yourself." Would anyone recommend that approach to areas relating to healthcare, or legal services? Doubt it. But, many are quick to do so when it comes to someone's life savings?

Not all investors are worth their fees, but many are. And just because an investment advisor is getting paid, doesn't mean they aren't worth it.

[mayhem69]

I just looked at the Funds this guy put my family in and i am not happy with them at all. They are all high interest funds with a 12b-1 fee. Alot of them are class B. How does it work with these class B funds. Don't they become class A after a few yrs.? I am assuming i do not want to sell the class B shares til they become class A, right? Then there will be no deferred charge?

[mayhem69]

I just transferred my entire acct. into my personal brokerage acct. at Vanguard. I had my wife tranfer hers last night. Now i just have to tranfer my kids' accts.
There is no way i am paying any more high ER's plus another 1.2% advisor fees. This guy robbed me long enough.
I will be investing in Vanguard funds now. Anyone have any recommendsations for Vanguard funds, i am 40 yrs. old.
So far i am in VWELX, i think is the tick, it is Vanguard Wellington.

[autoxer]

Congrats! I enjoyed the day that I did the same thing, freeing myself from those financial drains.